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Web-based open source solutions: 5 successful business models (part 1)


Have you ever thought that there will be a day, your open-source project would become the next year’s hottest unicorn? You need to put all the effort to make that day become true. Because the smallest risk of open-source projects turns into abandonware is so high. The growth of one project will go along with a lot of demands placing on your times as well as money. At that point in the development process, you will stand at the way with two directions. You have to make a choice: abandon it completely with the hope that someone with more resources successfully forks it or begin exploring business models that could provide the resources you need.

In this article, I would like to discuss with all of you about the five most common business models for web-based Open source solutions projects. When considering there will be certain things you need to consider on a business model. I will not make comparisons or debate which model is the best. However, I will list out some of the points that I think you should never ignore.

Definition of Success

In our lives, we talk a lot about success. But when you say something is successful, which criteria you use to measure it? What metrics do you use to determine that these are successful business models? If you look at a company that applies these business models, do you decide they are successful or not based on their sale revenue, a number of employees or the number of paying customers. What then of the number of times the project had been formed by other companies that ended up making money off it? Isn’t the number of contributors you have a measure of success too?

It is undeniable that to define what is a success is problematic. Although we can explain success in simple terms is the achievement of an aim. The goal is unique to each person or organization. So, initially, from the point of view of a developer, you should define what is a success depending on your case.

If we turn back time to 2013, Matt Mullenweg, the founder of Automattic wrote:

Automattic is healthy, generating cash, and already growing as fast as it can so there’s no need for the company to raise money directly – we’re not capital constrained.

However, one year later, in 2014, after raising $160 million from investors, he found that it was wrong. Because Automattic is still somewhat of a poster child for open source solutions success stories. We found that Matt was quite satisfied with what has been achieved so far. He decided to continue going with open source solutions with commercial ventures designed to sustain the company rather than generating massive revenue. In other words, they want to go a long journey rather than the short term plan.

To be continued…

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